By Keith Brown, DTN Cotton Correspondent
With all the repetition of a broken record, we have to say the cotton market remains tied to the Dow Jones. To that end, the stock market traded all over the place Wednesday as it moved up and down on every news tidbit concerning the coronavirus relief bill currently being debated in the Congress. Thus as the Dow unfolded with an afternoon rally, so too did cotton slightly improve.
Thursday, USDA reports on weekly exports-sales. Although, sales have been very strong this year, of late they have carried no bullish impact, as the collapsing Dow overwhelmed those fundamentals. Understanding global demand destruction may be happening; cancellations by some foreign customers may occur into mid-to-late spring.
As the markets move towards month’s end on March 31, it will also be the end of the quarter. Often at such intervals, speculators tend to adjust their trading positions. Given how demonstrably net short they stand, a short-covering move could be in the works into the deadline.
For Wednesday, May cotton closed at 53.44 cents, up 0.55 cent, July finished at 53.53 cents, up 0.52 cent and December ended at 55.04 cents, up 0.39 cent. Estimated volume was 32,161 contracts.
Source: Agfax